Premium Archives - Get Your Commercial Insurance Questions Answered by Licensed Professionals at My Insurance Question.com

6 things an underwriter loves to see when quoting commercial insurance.

For most small business owners, purchasing insurance is not one of their favorite things to do. Most business owners would rather be involved in the day to day operations of what their business does to make a profit. Taking a little extra time before you pick up the phone to get a quote can make all the difference in the world when you are offered a quote. Here are 6 things to keep in mind when speaking with your agent about a business insurance quote.

Small Business Insurance

Have your info.

Everyone wants a quote and they want it quick, but insurance is not a business in which a company can quote a price on the drop of a hat. Proper tax id number, your experience modification rating and accurate payroll figures make the process much quicker for an agent to get a quote from the underwriter. If you don’t have this information a carrier cannot and will not offer you a quote. to save yourself and the carrier some time, have this information ready before you start looking around for coverage.

Safety programs are in place

Safety programs can be expensive and time consuming, but they absolutely benefit your company in many ways. First and foremost, they lower the amount and severity of injuries that occur to your employees. Second they limit the amount of time it takes injured employees to return-to-work. Third it can impact what you pay in premium for commercial insurance. If and when you have an injured employee, your insurance agent can negotiate on your behalf with your insurance carrier to not raise your rate on premium because of the claim. If a detailed safety plan is in place the carrier might see this one incident as more of an outlier and not a sign of how the business operates. If there is not a safety plan in place your business is much more likely to have your rates go up or be dropped by your carrier altogether.

A thorough and accurate website

The accuracy of your website is extremely important. Your agent is going to have a conversation with you about your operations. During this conversation it is important to tell him not only what your business does, but more importantly what your business does not do. Your website needs to match up with this description. If you run a landscaping business that does not work on trees, but your website offers tree services than an underwriter is going to wonder what else you are not telling them. This is a great way to get a higher premium or more likely be denied coverage altogether.

A detailed payroll history

I know you may not like giving away too much information about your business, but the more accurate this number is that you give to your agent the more accurate your quote will be. This will all get straightened out during an end of term audit, but it is best to prevent over or underpaying on premium by giving accurate numbers to your carrier up front.

Don’t be a rate jumper

A business who seems to change carriers every year at the slightest drop in premium. Carriers want to establish a long term relationship with a customer. If you have several carriers over the last few years it may be a red flag that those carriers dropped your business or that the carrier may only have your business for one term. Unless your payroll is extremely high it may not be financial sound for them to quote you.

Don’t forget, in the end they work for you

If you forget a few pieces of information that are necessary for a quote than it might be expected for the agent or underwriter to be a bit frustrated. But never forget that these people work for you. If they make you feel too uncomfortable do not hesitate to walk out and speak with another agency or carrier. Do what you feel is best for your business.

Why so many questions???

Shopping your Workers Compensation insurance –

4 Tips for the best and fastest results

Shopping insurance can be a daunting task. This is not commonly the case with other purchases. When you buy a couch, you just pick out one that feels comfortable. One that fits your room or matches your style. You look for one that is in your price range and bam! you have the newest edition to your next super bowl party.

Shopping insurance, as much as we would like it to be, is not like buying a couch. Yes, you shop for a policy that fits your coverage needs and the budget you are able to afford, but there are some distinct differences to shopping for an insurance policy. An important factor to consider is the seller’s motives. When you buy a couch, the sale for all intents and purposes is over. The expense and liability of the company selling the couch is basically the same no matter who they sell the couch to. When you buy insurance, the company who is providing that coverage doesn’t have the same benefit. Insurance companies use a variety of data to determine the risk of each person or business purchasing from them. The reason this information is used is because it has been shown somewhere in their data that this factor shows a correlation between certain variables and their likeliness of a claim. There are something you can do to help tip the odds in your favor. Here are four tips for making the quoting process easier for you and can help you get you the best price you desire:

Be Presentable: Dress your business up for Sunday church, not casual Friday. Show a clear outline of the purpose of your business and the kind of work you do. Equally importantly is to outline the work you won’t do. Make sure your marketing material and websites match this. There are few objections harder to overcome with an underwriter than a website that says you do something your application says you do not. Having these things in line is the best way to get a great first impression.

Be Open about the biggest risk: Every company has some operations that are lower risk than others. Insurance is as much about preventing claims as it is about paying them. The goal of the industry is to make your business whole after a claim, but wouldn’t it be better if we help you to prevent that claim from happening in the first place. Tell your agent about everything you do. If we don’t know that you are hanging from a rope 50 ft off the ground with a chainsaw in your hand, we can’t help find a better way to protect yourself and your employees in that situation (true story).

Note the details: Sometimes high risks are deal breakers, however sometimes in the right circumstances this can be overcome by showing the amount of this exposure. “Yes, we do work on roofs, however they are only flat commercial roofs and only ones with inside stair access or a permanently attached ladder with walls around the perimeter”. The controls you have in place for the highest risk work will be the most vital controls to focus on.

Don’t be afraid to show your hand: A lot of times people look at an insurance purchase like a poker game. If you are buying insurance as a commodity, then that’s what you should expect to receive when you want that policy serviced.

If you work on the same side of the table with your agent however they can work to get the best pricing possible. There is no better pricing than you can obtain from an insurance company than when the underwriter knows what they are insuring. When the underwriter is confident in your business and knows what price they have be at to earn your business they may be more aggressive with credits and discounts. There is much more savings to be had if you say “this is the premium you have to be at to earn my business” than there is with “show me your best price”.

12 terms to familiarize yourself with before your next renewal.

Insured

The person, group, or organization whose life or property is covered by an insurance policy.

Insurer

Insurance company that issues a particular insurance policy to an insured. In case of a very large risk, several insurance companies may combine to issue one policy.

Named Insured

Any person, firm, or organization, or any of its members specifically designated by name as an insured(s) in an insurance policy. .

Premium

The price or amount paid for insurance.

Claim

A formal request to an insurance company asking for a payment based on the terms of the insurance policy.

Carrier

A company that offers and underwrites insurance policies.

Policy

A document detailing the terms and conditions of a contract of insurance.

Underwriter

The person who decides whether to provide insurance and under what terms.

Agent/Broker/Producer

A person licensed by a state and employed by an insurance company to sell insurance policies on the company’s behalf.

Umbrella Coverage

Umbrella coverage protects your business when your existing liability insurance policy limits can’t cover all the expenses of a claim.

Hired and Non-owned Auto

A coverage that is commonly added or endorsed onto a commercial auto insurance policy. This endorsement adds additional coverages for the insured in the event there becomes a liability issue for an automobile accident involving a vehicle they don’t directly insure (rentals or employee owned cars).

Experience Modification Rating

An employers’ Experience Modification Rating refers the factor calculated from actual loss experience. It is used to adjust the businesses premiums (higher or lower) based on the businesses loss experience relative to the average underlying manual premiums for workers compensation coverage. The Modifier (Mod) compares the insured experience to the average class experience.

Additional Terms to consider familiarizing yourself with before your nest renewal

Waiver of Subrogation

A Waiver of Subrogation is a contractual provision whereby an insured waives the right of their insurance carrier to seek redress or seek compensation for losses from a negligent third party.

Certificate of Insurance

A certificate of insurance is a document that is used to provide info on specific insurance coverage and provide verification insurance is in place at the time of issuance. The certificate contains the types and limits of coverage, the carrier, policy number, named insured, and the policies’ effective dates.

Certificate Holder

The certificate holder is the person, business, or nonprofit organization who is provided with a certificate of insurance to prove coverage is in place at the time of issuance. The certificate holder will be notified if at any time the policy is cancelled before the listed policy effective date.

Additional Insured

The Additional Insured is the person or organization who is not automatically included as an insured on an insurance policy, but who is included under the policy at the request of the named insured.

What is the difference between a Hard market vs. Soft market

Hard market and soft market are terms you may have heard before and they generally are categorized this way due to premium trends on commercial insurance. We will discuss in more detail below but the main difference and what really dictates them are industry wide or catastrophic claims for insurance carriers across the board. In layman’s terms, a soft market has loosened underwriting restrictions and lower premium. A hard market is just the opposite. Currently the industry is in a Soft Market.

Soft Market:

Lower insurance premiums
Broader coverage
Reduced underwriting criteria, which means underwriting is easier
Increased capacity, which means insurance carriers write more policies and higher limits
Increased competition among insurance carriers.

A soft market can affect a carriers’ bottom line due to lower rates. A carrier relies on a combination of insurance premiums and investments to make money as a company. This is an area to watch when carriers get downgraded by AM Best because it’s generally due to bad investments and bad decisions on what business to write.

Hard Market:

Higher insurance premiums;
More stringent underwriting criteria, which means underwriting is more difficult;
Reduced capacity, which means insurance carriers write less insurance policies;
And less competition among insurance carriers.

Are we moving towards a Hard Market?

Mother Nature and the effects of the economic downturn have been the main causes for change in the insurance industry over the last 18 months prompting some to think we are in or heading towards a hard market. In addition, there are two other areas that can affect business insurance premiums – payroll and revenue. As companies began experiencing a decrease in revenue, employees are let go. Both their payroll and revenue are now lower, which means a decrease in premium to the insurance carrier. This is another way in which the carrier is losing money due to the economic downturn.

What can we expect from Insurance Carriers during a Hard Market?

During a hard market, underwriting gets tougher and more stringent. Meaning they are not as likely to quote a business with low payroll or in a risky class code. With each year, underwriters are becoming more sophisticated. They are looking more closely at losses, safety records and financials. Those in the industry are seeing insurance carriers dig deeper into a company’s financials than in the past. Rates will vary from carrier to carrier and will depend on a business’s inherent risks, claims history and finances. This is why it is important to always being looking for the best price + carrier you can find on a regular basis. Whether that is every year or every couple years you should always make sure that they are earning your business. An independent agent who partners with several carriers can help make this task easier for you as a business owner.

What you can do in a Hard Market when you are seeing rates increase?

While you will most likely need to be prepared for some rate increases due to the insurance industry’s hard market, there are several things you can do to help minimize the impact until the cycle turns back to a soft market:

Because the market and underwriters are becoming more restrictive, it is imperative that as a company you are more involved with your safety programs.
Take a more active, strategic approach to managing your company’s risks and claim activity.
Start your insurance renewal process earlier. Some carriers want at least 30 days to quote your business. Starting 60 to 90 days before your term ends can really help this process.
Be even more cognizant of your company’s financials – most insurers are looking at whether bills are being paid on time and many carriers are using third party companies to conduct credit scores.

20 terms you need to know when purchasing or renewing commercial insurance

For many business owners, purchasing insurance is a foreign concept. Like many industries there are terms only the insiders know and they frequently use when discussing the policies. Here is a list of 20 terms that will give you a leg up the next time you are purchasing or renewing your commercial insurance policy.

20 commercial insurance terms to be aware of the next time you look to buy small business insurance.

Insurer – a person or company that underwrites an insurance risk; the party in an insurance contract undertaking the risk to pay compensation.

Insured – a person or organization covered by an insurance policy.

Peril – the possibility that you will be hurt or killed or that something unpleasant or bad will happen. exposure to the risk of being injured, destroyed, or lost.

Premium – An amount to be paid for an insurance policy. It is an amount paid periodically to the insurer by the insured for covering their risk.

Deductible – A deductible is the amount you have to pay out-of-pocket before the insurance company will cover your remaining costs.

1st person liability – First person liability is for damage that is done to you or your business. A good example of this would be a commercial property insurance policy. This policy covers the damages to you and your property. It does not cover the damage to another persons’ property or if they are hurt on your property.

3^rd person liability – Third person liability is liability that you or your business has to other third parties. Third parties can include customers, vendors, other businesses or anyone who may be harm by the actions of you or your business.

Claims-made policy – A policy written on a claims-made basis means that if the insurance is in place when the claim is made, but not when the occurrence took place than the insurer responsible for the claim is the insurer when the claim is made. This is common for professionals like a lawyer or an engineer. In these professions a claim is frequently filed months if not years after the occurrence takes place. At that time the insured may have coverage with a different company and there may be some discrepancy between who is responsible for the claim.

Occurrence based Policy – A policy written on an occurrence basis means that the insurer responsible for the claim is the insurer who was in place when the occurrence took place. If an engineer works on a house and there is a problem with the house years later than the insurer responsible for the occurrence is the insurer that was in place when the occurrence took place.

Endorsement – an endorsement is a document attached to an insurance policy that amends the policy in some way. An endorsement may add, remove or alter the scope of coverage under the policy.

Negligence – Negligence in relation to insurance means a person or business did not demonstrate appropriate amounts of care or responsibility for a particular situation. The failure to take appropriate precautions can cause you to be considered liable for the damage. This can also be referred to as the failure to use a degree of care considered reasonable under a given set of circumstances. Liability policies are designed to cover claims of negligence.

Named Insured – Any person, business or organization who is specifically named as an insured on an insurance policy. This is different from entities who although unnamed may fall within the policy definition of an insured.

Ordinance or Law Coverage – Coverage for loss caused by the enforcement of an ordinance or law regulating construction and repair of a damaged property. Older structures that are damaged may need to be upgraded in regards to electrical, plumbing, venting, etc. A typical commercial property insurance policy does not pay for these additional cost. This policy is an endorsement on top of your commercial insurance policy and will cover the additional costs needed to bring the new building up to date.

Hammer Clause – A ‘Hammer Clause‘ is a provision within an insurance policy that gives the insurer the right to settle for an undisclosed amount and if the insured does not agree to the settlement than they take on some or all of the risk. In some cases, the insured takes on all of the risk, but in many cases it is 70/30 or 50/50.

The Assigned Risk Provider (Also known as the pool or the state fund) – The assigned risk provider applies to workers’ compensation coverage. It is the provider of last resort within each state for businesses who cannot obtain coverage on the open market. The business may not be able to obtain coverage for a number of reasons. Typically, it is because of the small size of the company or because of their loss history. The Assigned Risk Provider offers coverage at a higher rate and typically once you are in the pool you must stay in the pool for 2-3 years.

Business Owners’ Package (BOP) – A business owner’s policy, commonly referred to as a BOP, combines several lines of coverage built into one policy. They are often better suited for small business owners because they offer targeted coverage options designed for specific types of businesses within certain industries. They are usually less expensive then purchasing coverage separately because the business is purchasing multiple policies for liability, property, commercial auto, etc.

Artisan Contractor – This term refers to businesses in several different industries. It includes many occupations that involve skilled work with tools at the customer’s premises. Carpenters, plumbers, electricians, roofers and tree surgeons are some professions that would be included in this group of businesses. Also included are diverse other skilled service providers, such as interior decorators, piano tuners and exterminators.

Loss History – Loss history is a documented history of damages or losses connected with a given asset. It is a way for the insurance carrier to determine the amount of claims your business has against an insurance policy. They use it to determine how much premium to charge or if they are willing to take on the risk altogether.

Inland Marine Insurance – Inland Marine Insurance is property insurance for property that is likely to be in transit over land. Many inland marine coverage forms provide coverage without regard to the location of the covered property; these are sometimes called “floater” policies. As a group, inland marine coverage forms are generally broader than property coverage forms.

Umbrella Coverage – The umbrella policy serves three purposes: it provides excess limits when the limits of underlying liability policies are exhausted by the payment of claims; it drops down and picks up where the underlying policy leaves off when the aggregate limit of the underlying policy in question is exhausted by the payment of claims; and it provides protection against some claims not covered by the underlying policies, subject to the assumption by the named insured of a self-insured retention (SIR).

Talk with your agent.

In today’s business world, time is of the essence for all business owners. When purchasing something for their business, many business owners want it done fast and cheap. They may have an inclination to rush through the buying purchase or to only focus on price. In many instances this may be wise, because their time is more valuable running the business than trying to save on buying whatever is needed for that business. When it comes to purchasing commercial insurance this is not a good idea. In this instances it is crucial for business owners to take the necessary time to have a long honest conversation with their insurance agent.

In conversations I have with agents in the insurance field, they all say rushing through the buying process is a mistake far too many business owners make. This is where a little time on the front end may cost the business owner some time away from their business, but on the back side it can save their business hundreds if not thousands of dollars when a claim does occur. During these conversations the agents are typically trying to get as much information as possible about the daily operations of your business. They understand business owners may be shopping around to more than one agency and that their time is valuable, but rushing through this process can cause your business to be under-insured or to pay too much in premium.

These problems frequently come about because business owners do not inform their agent what exactly the business does and what the business does not do as a part of their daily operations. Insurance companies are in the business of analyzing risk. It is in their best interests to assume more risk rather than less. They can only assume the risks of your business based on the information you provide them with. If you do not provide them with the enough information they frequently will assume more risk, which costs more in premium.

In most industries there are numerous industry classification codes. In most states these classification codes are determined by the National Council on Compensation Insurance (NCCI). These classification codes separate businesses by the type of work they do or do not partake in. Take landscaping as a prime example. There are at least a half a dozen class codes for lawn care and landscaping based upon the daily operations of your business. The two most common NCCI classification codes for the landscaping industry are 9102 and 0042. 9102 is designated for lawn care or maintenance of existing lawns, where 0042 is designed for businesses that install lawns and beds. The second class code is more dangerous and has a higher premium. If you rush your agent through the quoting process, they may place you in the wrong classification code. This can cause your business to end up paying far more in premium than is necessary. These mistakes frequently get fixed during the end of term audit, but even when they do your business has still paid more in premium than was necessary. That means there is cash-flow your business could use tied up in unnecessary insurance premium.

On top of tying up cash in premium, another problem exists that a good insurance agent can help your business with. The problem they can help your business with is to understand what exactly is and is not covered under your different insurance policies. This can help you fill in coverage where gaps might exist. This is where an agent can help you determine if you need a coverage like Business Loss of Income Coverage or Data Breach Insurance.

Business loss of income coverage is a policy that is a type of commercial property insurance coverage that kicks in when a business suffers additional loss of income suffered when damage to its premises causes a slowdown or suspension of its operations. The damage has to be the result of a covered loss. Take for instance if your building experiences a fire. Your commercial property insurance will cover to repair the damaged building, but it will not cover your business for lost revenue while you have to be closed for repairs. This is where business loss of insurance coverage kicks in. Many businesses who fail to secure this coverage do not survive when an occurrence happens.

Data breach is another coverage that is becoming more and more necessary. Many business owners feel they are too small or do not deal with computers or customer information enough to need this coverage. Take a commercial cleaning company for example. They have 5-15 employees and clean 5 office buildings and one retail store at night while the businesses are closed. Their employees only use a cell phone and never interact with a computer. Their business owner thinks they would never need something as advanced as data breach coverage. But what if you clean the offices of a bank and an employee of the bank leaves a post-it note on their desk with the username and password for the internal system. If one of your employees finds this they could get into the system and access the financial records of the banks customers. That is a need for data breach coverage. Two of the largest data breaches in history, Target and Home Depot, were started by hackers first accessing a small business who was a partner of the larger business that got hacked. You do not have to be a big company nor do you have to store lots of personal information in order to be a target for criminals.

All of these and other problems can easily be prevented by taking the time in the first place to speak long and honestly with your independent insurance agent. They can help you understand what risks your business because not only do they interact with business all the time when they are purchasing insurance, but they also frequently interact with business owners when the unfortunate accident occurs. From that experience they can help you prepare for when dooms day comes for your business. If you take this time to properly protect your business it can be the difference between closing your doors for a short time and closing your doors forever.

5 Myths about Commercial Auto Insurance.

Commercial Auto Insurance can be a tricky coverage for many business owners. Many think it is just like their personal auto coverage and many think it is an all encompassing policy, meaning if something happens to my business car I am covered. Right? That would be wrong and here are five examples of incorrect assumptions, many business owners make regarding their commercial auto Policy.

All of My Employees Are Covered While Driving Company Vehicles

It depends on the policy and the carrier. Some policies require you to name drivers. In some cases companies will exclude some of your employees because of their driving record. Most all carriers have an option to include all drivers. Like in all situations, it is best to consult with your agent about the limits and exclusions to your policy. That way you can be crystal clear what is and is not covered under your particular commercial auto insurance policy.

I Can Cancel My Policy During the Off Season to Save Money

You can choose to cancel your policy in the off-season if your business is seasonal. It can save your business some money on premium if you are able to store your vehicle indoors and in a secure place. If you are planning on doing this you need to be aware that the vehicles are still at risk. If there is damaged you are liable for the repairs. This damage can come from via natural causes like wind and hail damage. Damage can also come from things like vandalism or theft. If you experience any of these problems while not covered you or your business will be responsible for damages.

The Entire Premium is Due Up Front

Most companies allow commercial policies to be paid in monthly installments. Most refer to these policies as Pay as You Go. If you have the ability to pay the full years amount up-front, many carriers do offer a discount for doing so.

Bundling is Always Cheaper

In many cases this is the case, but it is always a good idea to shop your policy around just in case. Some carriers specialize in certain coverages and some carriers change their appetite for certain industries and types of coverages. This means that if your carriers has recently taken a loss in one industry or in one type of coverage, they may not be as excited about quoting your policy. This may cause them to offer a higher rate for this one policy or for your industry. For this reason, it is important to partner with an agency who has partnerships with many carriers and can quote your policies as a bundle and individually.

If you are self employed you don’t need Commercial Auto Insurance

I drive a company car, so I don’t need my own auto insurance.
The car may be covered, but you may not. Even if your employer has coverage that provides some liability protection, it may not be enough, or you could be sued personally in a bad accident. Also if you borrow or rent a car, you should have your own protection. Being listed on another auto policy isn’t enough to protect you because business use is different. You need to purchase special protection.

Insurance policies are not all created equal

Taking the leap of starting your own business is never an easy one. Whether you are a weekend warrior looking to pick up some extra income or branching out all on your own; you are taking a risk and putting yourself out there. this is something that most of the population could not fathom, but you are truly the future of our economy.

Most new businesses determine a budget, buy tools/equipment, set up a website and plan for all the business to come in. Insurance tends to be a side note that you know you will need to check off your list, but far too many too not take this aspect serious. Many new business owners seem to look at insurance and attempt to find the cheapest price they can find. This is a mistake that can lead to financial disaster for your business. Here is why this method of thinking can get you into trouble:

When you are a new business a few things tend to be very common. You generally know what kind of work you want to d. You might or might not have an idea of what work you are not willing to do. You also might have only a few employees, but you probably don’t know how much you’ll pay them. On top of that who knows how much sales you will have your first year. When you are shopping for a General Liability Insurance Policy these are all things you need to know. Before picking up the phone to call an insurance agent, here are a few things you need to keep in mind when comparing quotes:

Compare the Total Premium but also the rate being charged

Many companies will quote based on minimum premium. For an owner only company this might keep you at this level and not be a problem. Once you start adding employees or increase your operating space, other coverages might be necessary. The rates could increase much faster with one company as your company starts to grow. Talk with your insurance agent about these types of things so you have a ball park idea of what to expect down the road.

Look at the Exclusions on the Policy

As a general rule no insurance policy covers everything. All insurance policies will have some sort of exclusion. These exclusions outline a “hazard” that the insurance carrier will not be responsible for covering. This is very important to know, so you can avoid these exposures. Especially since your business will be on the hook for them. A lot of times they are exclusions for a reason. It is not typically for a carrier to strip down the policy just for a cheaper price. Most of the time these inclusions are in higher hazard areas. In the past these areas have cost insurance companies big and they are attempting to limit the risk they take. Taking this approach in your business operations can help you decide what work are not willing to do. It is usually easiest to make changes early on in your business as opposed to later down the road. Knowing these exclusions is important to minimizing the risk to your business and helps you determine what amount and type of risk you are willing to take in your daily operations.

Occurrence or Claims Made?

General Liability forms are written on either an Occurrence or a Claims Made basis. Occurrence is typically going to be more expense. If it is even available. Claims Made Policies limit the reporting period that you can report a claim to be covered under your policy. Professional Liability policies are typically offered only on Claims Made basis. If Claims Made is your only option, one of your main priorities should be making sure you don’t have a lapse in coverage. A lapse in coverage can leave your business vulnerable for much more than you may think.

Compare rating factors

Depending on the policy type, your type of business and coverages being offered; rating factors could vary into what determines your premium. Here are a few variables that can drive the premium though:

Square Footage: The amount of space for your building, the amount occupied and the amount of retail space can directly impact pricing of your liability policy. This is especially important for retail businesses. As well as General Liability, it can also impact your Commercial Property Coverage.

Payroll: Payroll is a direct rating factor for all Workers Compensation Policies. It also is a primary rating factor for most Contractors General Liability policies as well. Getting help to anticipate what your payroll will be should be something a decent agent can help you with.

Employee Count: Employee Count can be a direct rating factor for some General Liability Policies. It can also be a determining factor for Employment Practices Liability Insurance Policies. In some cases full time vs part time can make a difference as well.

Property Value & Valuation Type: The amount of Value, Reinsurance rule and Valuation type can all impact your pricing for your property coverage. If the Valuation is Replacement cost vs Actual cash value, than the coverage is very different. This is because of how the claim will be paid and the amount your business is insured for. If the valuation amount is not sufficiently covering the amount of property you have this can leave you not receiving the full value you lost in the event of a claim. This is something that is much better to compare when choosing an insurance policy than hashing it out with your insurance carrier when its too late and you have a claim.

Gross Sales, Garaging Zip Code, Location Address: These are a few other of many variables insurance carriers will look at in quoting your insurance policies. Sometimes they are direct rating factors but on most policies they can be a gauge for determining your pricing.

There are many factors to consider when determining which policy and coverages are right for you. There are less expensive policies that don’t cover as much, and there are also Cadillac plans that might cover more than you are looking for and many options in between. The key to take from this is not that you have to go with the Cadillac or to take the cheapest option, but make sure you are comparing the correct variables to know you are choosing the right option for you and knowing what you are covered for and what you are not covered for.